On December 9, 2014, the United States Supreme Court unanimously reversed a decision by the United States Court of Appeals for the Ninth Circuit holding that warehouse employees had stated a claim for unpaid wages under the Fair Labor Standards Act (FLSA) for time spent undergoing an antitheft security screening at the end of a shift. Integrity Staffing Solutions, Inc. v. Busk, No. 13-433, 2014 WL 6885951 (U.S. Dec. 9, 2014).1 Because the time spent by the warehouse employees waiting to undergo, and actually undergoing, the antitheft security screenings was not integral and indispensable to the principal activities that the employees were employed to perform, the Supreme Court held that the security screenings were non-compensable activities under the FLSA.
Plaintiffs Busk and Castro were hourly employees of Integrity Staffing Solutions, Inc., which provides staffing for warehouses owned by Amazon.com. Their primary job duties involved retrieving items from inventory and packaging those items for delivery to Amazon.com customers. After clocking out at the end of their shifts, the Plaintiffs were required to pass through a security screening before exiting the warehouse. During the screening, which took approximately 25 minutes each day, the Plaintiffs were required to remove personal belongings from their pockets and walk through a metal detector.
In 2010, the Plaintiffs filed a class action complaint in the United States District Court for the District of Nevada on behalf of themselves and a putative class of similarly-situated employees in two Nevada warehouse locations (Las Vegas and Fenley, Nevada), alleging in relevant part that Integrity Staffing’s failure to compensate them for time spent on the required security screenings violated the FLSA and parallel provisions of Nevada law. The Plaintiffs asserted that the security screenings were for the benefit of the employer and were necessary to the employer’s task of minimizing the loss of products from warehouse theft. In Integrity Staffing’s motion to dismiss for failure to state a claim, however, Integrity Staffing argued that the Plaintiffs’ alleged time spent on the activity of post-work security screenings was not actionable under the FLSA because the activity was not integral and indispensable to their principal activities of employment.
The district court granted Integrity Staffing’s motion to dismiss, dismissing Plaintiffs’ lawsuit in its entirety and finding in relevant part that the Plaintiffs were not entitled to compensation under the FLSA because the time spent waiting in line and passing through a security screening was not “integral and indispensable” to the Plaintiffs’ principal activities of “fulfilling online purchase orders.”2 Citing the Department of Labor regulations, the district court reasoned that security screenings “fall squarely into a non-compensable category of postliminary activities such as checking in and out and waiting in line to do so and ‘waiting in line to receive pay checks,’ because Plaintiffs could perform their warehouse jobs without such daily security screenings.”3
The Ninth Circuit reversed the district court on appeal, however, holding that the Plaintiffs could state a claim under the FLSA based on Integrity Staffing’s failure to provide compensation for time spent in post-shift security screenings.4 The Ninth Circuit concluded that the security screenings were compensable under the FLSA because they were “require[d]” by Integrity Staffing and performed “for Integrity’s benefit.”5 Thus, pursuant to the Ninth Circuit’s decision, the Plaintiffs could state a claim under the FLSA because “the security clearances [we]re necessary to employees’ primary work as warehouse employees and done for Integrity’s benefit.”6
Integrity Staffing appealed the Ninth Circuit’s holding. The sole question presented to the Supreme Court for review was whether the time spent by the warehouse employees waiting to undergo, and actually undergoing, the security screenings was compensable under the FLSA. In reversing the Ninth Circuit, the Supreme Court’s analysis interpreted the Portal-to-Portal Act of 1947 provision that exempts from the FLSA’s compensation mandate any activities that “are preliminary to or postliminary to” the performance of the principal activity or activities which an employee is employed to perform.7
The Supreme Court concluded that the security screenings at issue were non-compensable “postliminary activities” for two reasons.8
First, the screenings were not the “principal activity or activities which [the] employee is employed to perform.”9 That is, Integrity Staffing employed its warehouse workers to retrieve products from warehouse shelves and package those products for shipment to Amazon.com customers.10
Second, the security screenings were not “integral and indispensable” to the employees’ duties as warehouse workers.11 In reaching this conclusion, the Supreme Court first noted that it has consistently interpreted the phrase “principal activity or activities” to include all activities which are an “integral and indispensable part of the principal activities.”12 After setting forth the ordinary definitions of the words “integral” and “indispensable,” the Supreme Court held that “[a]n activity is therefore integral and indispensable to the principal activities that an employee is employed to perform if it is an intrinsic element of those activities and one with which the employee cannot dispense if he is to perform his principal activities.”13 The Supreme Court noted that its “integral and indispensable” test was consistent with the Department of Labor regulations.14 Based on its articulated test, the Supreme Court reasoned that the security “screenings were not an intrinsic element of retrieving products from warehouse shelves or packaging them for shipment,” and that “Integrity Staffing could have eliminated the screenings altogether without impairing the employees’ ability to complete their work.”15
The Supreme Court concluded that because the “integral and indispensable” test focuses on the productive work that an employee is “employed to perform,” the Ninth Circuit erred by focusing its test on whether an employer “required” an employee to perform a particular activity.16 Indeed, the Ninth Circuit’s purported test “would sweep into ‘principal activities’ the very activities that the Portal-to-Portal Act was designed to address.”17 Finally, the Supreme Court rejected the Plaintiffs’ argument that the security screening time was compensable because Integrity Staffing could have reduced the time to a de minimis amount.18 The Supreme Court explained that the nature of an activity or its relationship to the principal activity an employee is employed to perform does not change simply because the employer could conceivably reduce the time spent on the activity.19